Competition concerns over lease length at Dublin Port
Long leases granted to terminal operators at Dublin Port – one of which has 110 years left to run – have been criticised in a major new report published by the Competition Authority.
The report on Ireland’s ports being published this morning, was undertaken at the request of the Minister for Jobs, Enterprise and Innovation, Richard Bruton as part of the government’s Action Plan for Jobs.
The watchdog is critical of aspects of state-owned Dublin Port, noting that certain arrangements at Ireland’s biggest port are restricting competition.
It points out that two load-on load-off terminal service providers at Dublin Port have 110 years and 85 years respectively left to run on their leases. A third load-on load-off (Lo-Lo) services provider operates under a general stevedore licence that was granted 20 years ago and which is due to be renewed next year for another 20 years on identical terms as long as certain conditions are met.
“The leases that Lo-Lo terminals operate under are exceptionally long and may have the effect of restricting competition by severely limiting the scope for new entry,” warns the Competition Authority. “Dublin Port Company should seriously consider reducing the duration of these leases in order to address their anti-competitive impact.”
The Competition Authority also said it has concerns regarding the licensing of stevedore services at Dublin Port.
It said there are only two general stevedore licences currently available. One operator generally provides services at Dublin Port’s north quay, while the other focuses on the south quay.
“These companies therefore enjoy effective monopolies in their respective licensed areas,” according to the Competition Authority.
The authority has also sounded a note of caution about merging ports.
“The policy focus should be to preserve competition and ensure that larger ports are working effectively and competing with one another,” it said. “While port closure or amalgamation may result in lower administrative costs they are unlikely to enhance inter-port competition.”